Bitcoin finally succumbed to the selling pressure we have been forecasting for the past few days. All things considered, the selling has been muted and reasonable, far more so than I expected. This sentiment may be premature of course. There could be another shoe waiting to drop. But I note that a 5th arc on a 15 minute chart has (so far) stopped the decline, so I lost my bearishness at the arc. I sent a tweet at the time.
Ethereum was a massacre. The selling took out every leveraged trader I am sure. Prices took a nosedive to $30 in a manner I briefly described in yesterday’s column. Short-selling, stop-running, margin calls and panic crushed a lot of people. I hope my leveraged readers were smart enough to take my advice and lighten their leveraged positions yesterday. If not, they saw their dreams dashed a few minutes ago.
I believe the low is in at $30, but there could be another show left to drop. It seems unlikely though, because the margin calls have already closed everyone out and the stops are cleared also.
Litecoin hit our target of $30 and has sold off a bit since then. Given the selling going on today, it may still correct pretty hard as well. Beware…
We suggested that ETH might correct to the $5.50 area. At this writing we have a low of $5.17. It seems like a low might be in, but it is hard to say. The bears are in full control this morning in a coordinated attack across the spectrum. It’s hard to say where any of it will end.
Overall, it’s a good morning to be either in cash, or short. There will be some great buying opportunities soon, but be careful!
Remember: The author is a trader who is subject to all manner of error in judgment. Do your own research, and be prepared to take full responsibility for your own trades.